The Asian air cargo market has rebounded strongly in 2024, with overall growth surpassing 2023 levels across all regions. Notably, the sector has shaken off the stress it experienced since mid-2022, with promising signs emerging in the second quarter of this year. Year-on-year growth in the region looks exceptionally strong, with many indicators suggesting that air cargo traffic may have already surpassed pre-pandemic levels, driven by double-digit expansion.
Several factors are fueling this growth. A robust economic outlook across Asia, a fading political decoupling narrative, and more synchronised supply chain practices are all playing a part. The ongoing Red Sea crisis has also shifted demand towards air freight as sea cargo faces delays. Additionally, China’s incentivised air cargo logistics policies have provided a significant boost to the sector.
Maturing markets such as China, India, Hong Kong, Vietnam, and Thailand are at the forefront of this expansion. Revised GDP forecasts for China and India, the region’s two largest economies, have been revised upwards, offering more optimism for the air cargo industry.
“During and post-pandemic , There was a sort of standstill on industrial purchases from China but, fortunately, it hasn’t resulted into reality as exports growth seems to have bounced back after a short gap,” Siddharth Sinha, CEO of SinoGlobal Logisitcs, outlined.
“The stop gap measures of decoupling, in turn, have helped other countries in the region to a fair extent. Exhibitions in China from commodities to telecom to industrial products have seen a good number of buyers retuning back to exhibitors and the market in whole is positive about order books.
“There’s a significant change in buyer’s lookout at logistics now compared to pre-Covid times as customers have started following freight patterns and the uncertainties around logistics in a more professional manner with major customers willing to pre-book spaces which benefits both consumer and service providers as over 50 percent space is blocked these days and rest is on free sale.
“It’s a win-win for both sides that gives air cargo operators a leeway to increase prices in peak times.”
Routes return
The post-Covid rebound has been strong for both the passenger and cargo sectors. Numerous reports, including those from the International Air Transport Association, highlight a significant surge in passenger demand. While the recovery in the West has been moderate, the Asia-Pacific region has experienced over 50 percent growth in passenger traffic, helping many airlines return to pre-pandemic levels. This has been driven by pent-up demand following extended lockdowns, as well as the revival of tourism and large-scale exhibitions across the region.
The Red Sea crisis is expected to continue driving airfreight demand from Asia. Analysts predict that conflicts in the Middle East and Ukraine could persist into 2025, increasing the need for airfreight as longer sea cargo transit times make air transport more competitive, sometimes narrowing the cost gap between the two.
e-commerce has been a significant boost for the air cargo industry. As global consumer demand grows, so does the need for direct “factory to home” shipments. e-commerce now accounts for over 20 percent of total air cargo volume, with an estimated equivalent of 100 Boeing 747 freighters of capacity required daily.
One of the most notable post-Covid developments has been China’s commitment to expanding its air cargo infrastructure. The country has introduced supportive policies that foster the development of new airfreight hubs and create additional cargo routes.
A key example is Ezhou Airport, an all-cargo airport in central China that encourages both domestic and international airlines to launch operations. In recent years, China has seen a surge in new air cargo hubs, including cities like Chengdu, Chongqing, Nanning, Changsha, Wuhan, Xi’an, and Zhengzhou. These hubs, once little-known, have become vital to global logistics, increasing flight frequencies to meet growing demand and alleviating congestion at traditional gateways.
“The factory of the world – Asia – will continue to benefit from the growing consumer demands despite mixed economic signals. Rising e-commerce segment will drive the revenue of airfreight industry and at the same time general cargo demands of parts of all industry from telecom to automobile and infrastructure among others will continue to support the ever growing demand in the long term,” Sinha explained.
“Service disruptions in the Middle East, Ukraine, the Red Sea crisis will surely add to the misery of customers in turn creating a short-term demand for airfreight business.
“These are geopolitical issue and will continue as long as we live. There will always be efforts to balance supply chains or change in tariffs. One may move a factory out of China to Mexico or even closer to Thailand, India or Vietnam but how much of it has really been successful.
“One can not undo what has been done/achieved in last 40 years. The short-term result evidently is that a lot more unfinished goods or raw materials are being shipped across Asia out of China and repackaged at the destination that benefits all stake holder. The airfreight industry has only gained out it.”
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